HP debuts cheaper digital audio gear

Hewlett-Packard is trying to expand its push into the living room with a cheaper, scaled-down version of the digital music stereo component it introduced last year.

The de200c, announced Monday, is similar to the de100c unveiled in June. Both are stand-alone appliances that let consumers download music from the Internet and then play it on a home stereo. Once downloaded, the music can be transferred to CD or various MP3 players, handheld devices and memory cards. Both units include a hard drive for storing digital audio files, a CD burner, and connections to access the Internet for streaming media and other functions.

The $999 de100c has a 40GB hard drive capable of storing up to 9,000 MP3 tracks. The hard drive on the new model is half the size, shaving $200 off the unit's price.

IDC analyst Susan Kevorkian said that's a step in the right direction, as prices are the main obstacle preventing such devices from finding a mass audience.

"They have been prohibitively expensive for mass-market consumers up to this point," Kevorkian said. Receivers priced in the $500 range should begin to appear before Christmas, she said, a price point that should spark mainstream consumer acceptance.

The hard drive-based receivers contrast with previous attempts at digital audio appliances that relied on a home networking connection to a PC. Dell Computer late last year killed its Digital Audio Receiver, and Gateway similarly ditched its Connected Music Player.

Home networking has yet to gain mass acceptance, and Kevorkian said those devices didn't make a strong enough argument to get consumers to wire their homes.

"Those were basically a thin client without storage, dependent on the PC for storage," Kevorkian said. "There was definitely more of a hurdle as far as consumer education, having them understand and use home networking technology."

Hard drive units have more potential, Kevorkian said, because they offer clearer benefits to the consumer, such as the ability to condense a large CD library onto a central device. But as the concept catches on, PC makers are likely to find more competition from audio component manufacturers such as Onkyo, which introduced a digital music receiver last year.

"I think there's room in the market for both," Kevorkian said, explaining that audio specialists have the advantage of better relations with electronics retailers, while PC makers can cut better deals with hard drive manufacturers.